Sometimes it works really well. With other things it will refuse to, e.g. call a contact whose name I will say clearly no matter how many variations I will try. Instead it chooses another name that clearly is as wrong as possible. Can't figure out how to correct it. When it works, I love it.
I've never had a problem with it - it always does exactly what I tell it to, and it's not as if I have to hold it directly in front of my mouth and speak crystal-clear either. While I do think it would be nice to add a few more features to it (I'm really confused as to why you can't specify a single song for it to play, such as "play song "song title" by "artist") but I think Spotlight works excellently for doing things like launching apps. I rarely flick through my home screens anymore.
I've only had one or two separate instances in the MANY, MANY instances I've utilized this feature. I tried playing an individual artist both times and it came up with the wrong one. Not a big deal because I think the culprit was the noise level of the environment. One time I was in my car with the window down and the other was while a couple other people were talking. I didn't think the other people were going to be a problem since they were like 10 feet away, but I guess they were.
I've also been in situations where I thought it was pretty noisy and it still worked.